1. The Federal income tax applicable to corporations:
a. Allows a deduction for the standard deduction.
b. Requires the determination of adjusted gross income.
c. Requires the determination of taxable income.
d. Allows a deduction for personal exemptions.
e. None of the above.
2. Income taxation at the State level can be characterized by all of the following except:
a. Same due date as the Federal return for most states.
b. Withholding procedures are required.
c. Taxation of income in all states.
d. Most states do not allow a deduction for Federal income taxes paid.
e. All of the above.
3. A characteristic of FICA is that:
a. It is imposed only on an employee.
b. A 16-year-old son who works for his parents is covered.
c. Over the years both the base amount and the applicable rates have remained the same.
d. It has two components made up of FICA and Medicaide.
e. None of the above.
4. Which of the following is characteristic of the IRS audit process?
a. Every income tax return has a 1% chance of being audited by the IRS.
b. The IRS can pay up to 20% of any tax deficiency collected as a result of information provided by an informer.
c. A field audit takes place at the office of the taxpayer.
d. The IRS may not audit the same taxpayer more than once in a three year period.
e. None of the above.
5. Which of the following is characteristic of the IRS audit procedure?
a. The percentage of individual income tax returns that the IRS audits has significantly increased over the last five years.
b. An office audit takes place at the office of the IRS.
c. One of the factors that leads to an audit is the information provided by informants.
d. IRS special agents are typically involved when fraud is suspected.
e. All of the above.
6. Economic considerations can be used to justify:
a. The exclusion for accident and health plans.
b. The installment sales rules.
c. Deduction for research and experimental expenditures.
d. The tax treatment of prepaid subscription revenue.
e. None of the above.
7 Which statement is true with respect to TAMs ?
a. They are issued by the National Office of the IRS.
b. They deal with completed transactions.
c. They may not be cited or used as precedent.
d. They are issued at the request of IRS personnel.
e. All of the above.
8. A taxpayer may appeal a case from which court?
a. U.S. District Court.
b. U.S. Tax Court.
c. U.S. Court of Appeals.
d. U.S. Court of Federal Claims.
e. All of the above.
9. Which trial court hears tax cases and other claims against the United States?
a. U.S. District Court.
b. U.S. Court of Appeals.
c. U.S. Tax Court.
d. U.S. Court of Federal Claims.
e. None of the above.
10. In § 2(a)(1)(A), the (A) stands for the:
a.Section number.
b.Subsection number.
c.Paragraph designation.
d.Subparagraph designation.
e.None of the above.